BOSTON PUBLIC RADIO

10:30 am

Fri May 30, 2014

Alex Beam On The Amazon Publishing Behemoth

The profit margins for booksellers have decreased dramatically with the advent of digital distribution. Boston Globe columnist Alex Beam outlined the battle between Amazon.com and book publishers.

Credit Kent Kanouse / Flickr

Boston Globe columnist Alex Beam was back for his regular Thursday Open Mic segment. Beam broke down the tooth-and-nail battle between once-mighty book publishers and Amazon.com. The two sides have dug in over e-book royalties.

Questions have been edited for length and clarity. Beam's responses are edited where noted (...).

What is going on with Hachette and Amazon.com?

You know how accounting firms used to be the 'big eight' and now the 'big four' or something? There's five companies that dominate US publishing, and they're all struggling with Amazon because Amazon has incredible market power. Everyone is trying to take a small amount of commission (...) from everyone else's piece of the pie. In this particular instance, [with] Amazon versus Hachette — which owns Little, Brown, it's a very well-known publisher — there's a direct conflict over royalties for electronic book payments. If you think in terms of a Jim Patterson I would guess he sells let's just say 1.4 million e-books a year, which is a lot. Let's say they're priced at $5. Amazon sets that price. Amazon and Hachette now cannot agree on a royalty scheme. (...) This is a lot of money when we're talking about a huge publisher's sales.

Basically, Amazon is taking it out on Hachette because they're increasing delivery time for their books, right?

I first learned of this eight days ago by a Facebook posting by Scott Turow, a former head of the Authors Guild — of which I'm a member, I might as well say. Scott Turow is a real broad-shouldered writer.

Turow is the author of One L, about Harvard Law School.

His first book was a bestseller. Presumed Innocent was a masterpiece. I read [his Facebook post] and he said, 'I'm boycotting Amazon.' I even left a comment, the thrust of which was, 'Boy, that's easy for you to say, Scott, you're Scott Turow.' There's a lot of things that are being lost here. There are thousands of authors (...) for whom Amazon is a godsend. Even [for] the Scott Turows of the world.

I was just at an event for my friend Joe Finder, who has a big thriller coming out. (...) A writer like Joe Finder with a big thriller is going to be selling a lot of books on Amazon, a lot of electronic books, a very high percentage of sales on Amazon. A mid-list writer, a "small" writer like me is going to be selling a lot of books on Amazon. (...) Self-published writers — Amazon has been very hospitable to self-published writers.

Should we be troubled that Amazon owner Jeff Bezos owns The Washington Post, too?

It's hugely relevant. (...) There's been a bit of a conspiracy by The New York Times and The New Yorker to blacken Amazon. Amazon is a ferocious and intelligent competitor, not an enemy of the book trade as that lengthy George Packer article in The New Yorker made out. The Times has printed at least two articles already. Not every fact in these articles is true. This is pretty sophisticated stuff. Joshua Ferris is a Hachette novelist (...) [who] has a book out right now. You can go buy it, get it delivered in two days, you can get it electronically. This is pretty sophisticated stuff. Books that are currently on sale are in fact available from Amazon.

I come at this from a slightly different perspective. I think it's fascinating that Jeff Bezos is the owner of The Washington Post. Because this means an extremely enlightened, tooth-and-nail competitor has taken over a major American newspaper. There's three interesting things happening: Bezos at the Post, John Henry at the Globe, and the kind of floundering Sulzberger dynasty. If you were playing a game of horse-race you'd say, 'Boy, I might put my money on Bezos and The Washington Post.'

When I clicked on your book American Crucifixion on Amazon, it said, 'Wouldn't you prefer Catcher in the Rye?'

(laughs)

Is it legitimate for Hachette to want more royalty money?

It's a negotiation. Let's say I wanted $500 every time I walked into your studio, and you two said, 'No, $210.' We would have a disagreement. Is one of us right or wrong?

But one of them is closer to a reasonable price. Is Hachette being unfair?

The part of the story that the Times got right is that it's a death-struggle. (...) Like many negotations it's a "domino" negotiation. In other words, whatever Hachette agrees to as a percentage of electronic-book royalties that it will turn over to Amazon, that will in effect be binding on the other four publishers.

To hear the rest of Beam's interview, including a bleak assessment of the US World Cup team, click the audio link below.